ESSAYS ON LAND PROPERTY RIGHTS IN CAMBODIA: EMPIRICAL ANALYSIS A DISSERTATION SUBMITTED TO THE GRADUATE DIVISION OF THE UNIVERSITY OF HAWAI‘I AT MĀNOA IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF DOCTOR OF PHILOSOPHY IN ECONOMICS AUGUST 2012 By Kouland Thin Dissertation Committee: Sumner La Croix Sang Hyop Lee Nori Tarui Timothy Halliday Alice G. Dewey Keywords: Land property rights ACKNOWLEDGEMENTS I am thankful to the East West Center and the Pacific Center of Excellence in the Elimination of Disparities for supporting me financially during the course of my studies at the University of Hawai‘i at Mānoa (UHM). I also would like to thank professor Sumner La Croix, who is my dissertation adviser, for his direct involvement in this dissertation and his support throughout my academic program. During this dissertation writing, I have benefited greatly from my dissertation committees. I would like to thank professor Sang Hyop Lee, professor Timothy Halliday, professor Nori Tarui, and professor Alice Dewey for their comments and advice on this dissertation. I would like to extend my gratitude to George Cooper and Jaynie Estermann for their support during my dissertation writing. I also wish to thank my friends at Hale Mānoa and various individuals at UHM community who support me spiritually during my stay in Hawai‘i. I am thankful to my parents and my parents-in-law who always provide me good food and encourage me to fight for this degree. The love and support from my husband and my son have made a substantial contribution to the completion of this dissertation. ii ABSTRACT This dissertation consists of four chapters on land rights in Cambodia. The first chapter focuses on historical background of land rights in Cambodia. De jure private property rights in land were first established in 1863. The civil wars of the 1970s led to an abolition of land property rights and it was again reintroduced in 1989 in which households could register their plots through sporadic land registration. The combination of a poorly functioning land registry system and rising demand for arable land led to a sharp increase in conflicts over land rights in the 1990s. To address these problems, the Cambodian government carried out a series of land policy reforms in the 1990s and introduced a systematic land registration in 2002 to speed up land registration in the country. The second chapter empirically estimates the effect of land property rights on investment in land by farm households in Cambodia using the 2003-2004 Cambodia Socio-Economic Survey (CSES). In this chapter, I use matching regression techniques, in particular Propensity Score Matching (PSM), to account for selection effects in household participation in land titling program. The empirical analysis indicates a positive link between de jure land rights and land investment. The third chapter estimates the effect of de jure land rights on household consumption. Instrumental variable techniques are used to account for endogeneity of de jure land rights. The results show that the choice to obtain de jure land rights results in a statistically significant increase in household consumption. The fourth chapter explores the relationship between de jure land rights and child health in households of land owners in Cambodia. The 2003-2004 CSES which is used to estimate this effect contains information of 8,745 children ages iii below 6 years old. The findings show that children of titled parcels have higher height- for-age z-scores than children of untitled parcels. iv TABLE OF CONTENTS Acknowledgments………………………………………………………………………...ii Abstract…………………………………………………………………………………...iii List of tables………………………………………………………………………….....viii List of figures……………………………………………………………………………...x Summary of chapters……………………………………………………………………...1 Chapter One: Land rights in Cambodia…………………………………..……………….5 1.1 Introduction………………………………………………….………………...5 1.2 The French colonial period (1863-1953)……………………………………...7 1.3 Post colonial period (1953-1975)…………………………………...………..10 1.4 Land property rights during the Khmer Rouge regime (1975-1979)……..….11 1.5 Land property rights during the PRK (1979-1989)…………...……………...12 1.6 Land property rights from 1989 till the present………………………..…….14 1.7 Sustainability of the cadastral database……………………………….……..21 1.8 Conclusion…………………………………………………………….……..23 1.9 Appendix 1.A Process of getting land titles…………………...…………..…29 1.10 References…………………………………………………………………..31 Chapter Two: Land rights and investment in land……………………………….....……33 2.1 Introduction…………………………………………………………..………33 2.2 Literature review………………………………………………………..……35 2.2.1 Capacity of land governance institutions…………………….…….38 2.2.2 Cultural diversity and context-specific conditions………………...39 v 2.2.3 Issues in the empirical studies………………………..……….……40 2.3 Prospects for enhancing land tenure security in Cambodia………………….42 2.3.1 Agriculture………………………………………………………....42 2.3.2 Land investment in Cambodia (1979 to 2004)………..…………...44 2.4 A model of tenure security and investment …………………………………46 2.4.1 Case 1: Land tenure security is exogenous………………………...48 2.4.2 Case 2: Land tenure is endogenous…………………...………........49 2.5 Empirical analysis………………………………………………………........50 2.5.1 Data………………………………………………………………...50 2.5.2 Farm characteristics………………………………………………..51 2.5.3 Household characteristics………………………………………….53 2.5.4 Empirical models and econometric issues……………………........53 2.5.5 Propensity score matching (PSM)……………………...………….55 2.5.6 Estimation of propensity scores………………………………..…..56 2.5.7 Estimation of the effect of land rights through PSM……………....59 2.6 Conclusion……………………………………………………………….......64 2.7 Panel A: Land title…………………………………………………………...71 2.8 Panel B: Land title and application of receipt………………………………..74 2.9 Panel C: Application of receipt………………………………………….......77 2.10 References…………………………………………………………………..80 Chapter Three: Property rights in land and household consumption………………….....85 3.1 Introduction…………………………………………………………………..85 3.2 Land reform and poverty reduction………………………………………….87 vi 3.3 Land reform and poverty reduction in Cambodia………………………........90 3.4 Empirical analysis and econometric issues………………..………………....93 3.4.1 Empirical model…………..……………………………….............93 3.4.2 Regression estimates…...……………….………………………….97 3.4.3 Data…………...……………………………………………..……..98 3.4.4 Household consumption…...……………….………………………98 3.4.5 OLS regression results…...…………………………………….....100 3.4.6 Robustness of the OLS regression results………………………...104 3.5 Conclusion……………………………………………………………….....110 3.6 References………………………………………………………………......119 Chapter Four: The impact of property rights in land on child health………...………...124 4.1 Introduction……………………………………………………...………….124 4.2 The impact of property rights on children’s health…………………………126 4.3 Children’s health in Cambodia…………………………...………………...129 4.4 Empirical analysis…………………………………...……………………...130 4.4.1 Data……...………………………………………………………..130 4.4.2 Estimation strategy…...….……………..…………………………135 4.4.3 Results………...……………………………...…………………...137 4.4.4 Weight-for-height……...…………………..……………………..139 4.4.5 Height-for-age……...……………………...……………………...140 4.5 Conclusion……………………..…………………………………………...143 4.6 References…………………………...……………………………………...154 vii LIST OF TABLES Table Page 1.1 Cambodia: Population and real GDP………………….………………………...….26 1.2 Average price of residential land in urban areas……………………..……………..27 1.3 Average price of agricultural land in rural areas…………………..………………..27 1.4 Legal status of agricultural land in 2004 and 2009…………………………..……..28 2.1 Land investment: 1979-2004…………………………..……………………………66 2.2 Farm characteristics: Summary statistics………...………..………………………..68 2.3 Household loans: Summary statistics…………………………….…………………69 2.4 Household characteristics: Summary statistics………………….……...…………..70 2.5a Propensity score estimation result for titled farm regression…..…....…………...…71 2.5b Result from PSM: Land titles…………...………………...………………………..72 2.5c Treated vs. controls (land titles)…………………………...………………………..73 2.6a Propensity score estimation result of a combined measure regression...………...…74 2.6b Result from PSM: Combined measure………………………….………………….75 2.6c Treated vs. controls (combined measure)……………………….………………….76 2.7a Propensity score estimation result of application receipt farm regression.….......….77 2.7b Results from PSM: Application receipts …………………………...………..……..78 2.7c Treated vs. controls (application receipts)……………………...…………………..79 3.1 Village characteristics: Summary statistics………………………..………….……112 3.2 Household loans: Summary statistics………………………………………..…….113 3.3 Household characteristics: Summary statistics……………………………………114 viii 3.4 Land titles and household consumption: OLS and instrumental variable regressions....115 3.5 A combined land rights and household consumption: OLS and instrumental variable regressions……………………………………………………………………………....116 3.6 Application receipts and household consumption: OLS and instrumental variable regression…………………………………………...……………………….………….117 3.7 Regression of land rights on all instruments and exogenous variables………….....118 4.1 Descriptive statistics of z-scores for child nutritional status in Cambodia, 2003- 2004……………………………………………………………………………………..144 4.2a Characteristics of children and their families by type of document..……………...146 4.2b Characteristics of children and their families: Summary statistics..………………147 4.3a Land title: Weight-for-height…………………...……………...………………….148 4.3b Combined land rights measure: Weight-for-height…………...…………………..149